Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, alongside my co host Matt Miller.
Every business day we bring you interviews from CEOs, market pros, and Bloomberg experts, along with essential market moving news.
Find the Bloomberg Markets Podcast on Apple Podcasts or wherever you listen to podcasts, and at Bloomberg dot com slash podcast. This is another name that kind of was on the radar screen for a lot of investors. They reported numbers last night a little bit better and expected people looking at the streaming business the losses there, we're a little bit lower. That's good. It's all part of Bob Byerker's
CEO's plan to cut costs here. But there's as many questions around that company as I've ever seen in my thirty years of covering it. Most you know, when you see a business like ESPN, which is just the rock solid core of this company for twenty twenty five years now, you're wondering whether you even want to own it. Mark Douglas joins, he's the CEO of Mountain. He knows a thing or two about this business, about the media business,
about the digital advertising business. Hey, Mark, you take a look at what is a stal war media company like Disney, and boy, there are a lot of question marks there. What did you what are some of the key issues for you when you look at Disney?
Well, I think the fundamental issue is Disney. You know, sell has magical prices for everything they do, meaning the prices are generally pretty high, and I think they're not really delivering magical you know, experiences and or magical content right now, and they keep looking externally for whether the factors that are affecting their business rather than just looking internally. And so even if consumers are spending less money, then deliver the magic and take a bigger share of wallet.
But you know, I think they're full of excuses right now, and until they look at themselves, I think this kind of like we're not doing as well as we used to is going to continue.
So, uh, what's the answer on the whole streaming thing? The streamers really make money?
Mark?
Because I was listening to Paul interview the head.
Of I think Sagraw and she was saying the streamers make thirty billion a year in profits and they want a piece of it.
Well, I mean, obviously Netflix is definitely making money, and I think you're gonna say it because Netflix, their ad supported tier is you know, off to somewhat of a slow start, but it's just hugely profitable for them. The what they're doing in password sharing again is just hugely
profitable for them. And my opinion is Netflix is going to kind of enter a new era of just increased learnings and I think anyone else can get there, but it starts with you know, people want to be in the parks, people want to watch Star Wars, they want to watch new Disney movies, and they want to do them at the same rates that they have in the past.
So I think Disney can absolutely get there. I'm a little concern that, you know, they're talking about reducing their investment in streaming or moving away from ESPN as if people don't want to watch sports anymore. And so it's as you open, it's a little bit of just like everything seems to be in turmoil, where you know, I don't think the consumer has actually changed that much. It's Disney's the one that seems to not know exactly the direction they want to go.
Yeah, and that even applies to the film business, which had been you know, ever since they started buying all these great brands like Pixar, like Marvel, like the Star Wars franchises. It was literally guaranteeing them two to three to four movies per year with a global gross in excess of one billion dollars. Now, even that business seems like it might be in a rut. They've delayed and
pushed out a lot of release dates. Maybe some people are saying, maybe we're oversaturated with some of these franchises. And then we just look at Barbie kind of a new original movie that's over a billion dollars in box office. So do you think Walt Disney's lost some of their magic when it comes to the film business?
Mark?
Yeah, I think you know.
So this is we've talked about the sports on the show. I mean, when your team's not doing well, everyone needs to remember how they catch the ball and hit right like it's baseball season right now, and the best managers just go back to basics. And I think Disney's problems are not huge if they just go back to basics. And if they go back to basics, they kind of
own the segment. There's these huge segments of the market, parents, children, sports, and you know when you see a company that owns segments of the market, I mean, just like dominate segments of the market like that, and they're a little confused as to what they should do, like just go back to basics, get a little less focus on near turn results in Wall Street, and just essentially kind of grow
yourself out of that. And and you know, especially when you have the kind of capital that Disney has to do it also, So I mean, they're not at risk of running out of money unless they look their losses continue for a very long time. So I mean that's my advice as a CEO by by gerbviously is a very smart guy, and he and and he's gonna, you know, follow what he thinks his best and so we'll see how this plays out.
You have any succession advice for Bob, Well, the last one didn't go well, didn't go any better than the show Succession, So.
I think he's gonna have to really fix this before he brings in someone else to grow it. Yeah, so that's it. I don't think he's there for one year. I think this is going to take a few years.
I haven't seen the end of Succession, So we won't will spoiler, won't we won't spoiler for you, Hey, Mark, you know, it's just when you think about Disney, there, like all the media companies really exposed to these strikes that we're seeing with the writers and the actors.
You're so involved with the you know, the advertising side of the business, the digital side of the business. What's your take on the strikes? Share, because boy, both sides seem really really entrenched.
Yeah. Well, I think, first from what I understand, the anything that was already in motion on the movie on the film side is is allowed. That project is allowed to get completed. So it's actually going to take a few more months before like literally everything is truly shut down. And then I think you know, the streamers and you know the studios and things like that. I mean, cash is king. They have a lot of cash to wake this out. So this is it's hard to predict how
this is going to go. But if it's a war of attrition on money, you know that's going to favor these big studios just kind of waiting it out to get a deal that they think is reasoned well.
And Disney has an added bonus that Netflix doesn't in the parks business, right.
I mean I heard yesterday they get seventy percent.
Of their operating income operating income from the parks.
That's the good news. The bad news is it's because the other businesses have gone down so much, you.
Know exactly the the movies in particular, I think have really been hurting them.
You're right, then, the parks businesses of rock Solid has always been the big franchises like I don't follow all the superhero movies, but that and Star Wars, uh and even Pixar.
They just haven't been as successful as they as they once were, have they?
Yeah, and and so I mean that again. You know, the content is a part of the experiences that Disney sells, and so you know they have to look inward and say, you know, is this because consumers don't want to watch Star Wars anymore? Or is it because maybe we're not doing the greatest job and giving them what they want? Because if you give them what they want, they're going to watch. And so you know, it's it's it's I'm going to keep eating that drum. It's back to basics to grow this business.
Hey, Mark, give us a sense of kind of the advertising market out there. You're so involved on a day to day basis, I can't imagine it's it's very good because I mean, I'm just thinking the economics, the economic environment is kind of uncertain here. What are you seeing out there just in terms of overall advertising.
Yeah, so if you're if your performance advertiser, your Google, your meta you know metas up your over year even TikTok, Amazon, you know, companies in the performance space, you continue to do quite well. If you're in the brand advertising space, more of the big TV networks, they it's a bit up and down. It's just literally I think month to month, the budgets are going up, they're going down. So it's not like this huge era growth right now. But it's
also not like a blood bath. I think that the you know kind of retraction and spending on brand advertising has already occurred and it's just a little less predictable. But overall, I think, you know, from everyone I talk in the industry, my own experience at Mountain, it's, you know, it's pretty it's relatively solid. Given the you know kind of how much the economy and the and economic news are just constantly up and down. It's pretty consistent right now, all.
Right, Mark great stuff is always Mark Doug As President and CEO of Mountain, giving kind of hists on what we saw from Disney and some of the streamers.
You're listening to the team Ken's are live program Bloomberg Markets weekdays at ten am Eastern.
On Bloomberg dot Com, the iHeartRadio.
App and the Bloomberg Business app, or listen on demand wherever you get your podcasts.
Makes a little m and a trade Today in the luxury space. Tapestry again one of the worst names in the business. They own the brands, including Coach and Kate Spade. They agreed to require Michael Core's parent Capri Holdings and an eight point five billion dollar deal to bring it down for us. Kritti Gupta, host of Bloomberg Surveillance Early Edition, joins us here in our Bloomberg Interactive Brokers studio. Pretty big names here, Uh critie, what do you make of it?
Yeah?
I don't think Tapestry and Capri necessarily resonates with everyone.
But when you hear the names Jimmy.
Choo Versachi, Kate Spade, Coach, perhaps some bells will ring and look, these are the two parent companies that, frankly have both been struggling. We know luxury. When you think luxury, you don't think the US necessarily. You think you're PM luxury, You think Rimez, you think Louis, et cetera. But it's the same model that these folks are trying to basically
make in the US sphere. The problem is that the appetite for luxury in the US is not the same as it is in Europe or the Middle East or China.
For example.
Why I go down Fifth Avenue, go down Madison Avenue and it seems like all the brands are there.
Sure that's not a representation of America, I gotta say. And that's I think where the value get at him.
You got to go to Dallas, Texas.
I'm going to give you a tour, and I'm going to show you what it's like to live in Middle America. Forwarth America. Forwarth, Texas is great and one of the fastest growing cities in the country, I should say, But.
Here's the point.
As you have this kind of wealth developing around the country, you need more access to some of these brands. And that's where Michael Cores the basically the founder of Capri Holdings, and Michael Cours the brand comes in handy because one of his major value ads is taking these really well known names Jimmy chou versace, et cetera, and making them more accessible to mainstream Americans by lowering down the price point, increasing the manufacturing. It's no longer an elite exclusive thing
to get a pair of Jimmy Chow's shoes. Sure, it's inventive, it is. It's expensive, how much as expensive as they were? I think a pair goes around for like seven hundred dollars.
Okay, that's luxury, hold on, that's exclusive.
It is one hundred percent, but it's not as expensive as like, say the two thousand they used to go for. That's the point before the acquisition. So the price point has actually come down and become more attainable. And if you go to any mall in America, there is a Michael Core store there.
Yes, that's not normal for a luxury Michael Cores. But can you buy Jimmy Chew's shoes also at any mall in America?
No?
But okay, they're heading in that direction. We are, we were.
And we have your no idea.
Ohio, I am, but I'm not shopping for Michael Cores or Jimmy Chew.
In fact, you will soon now that your girl dad.
Well, we were trying to make the distinction between you know, something like Coach, which I don't think they would define themselves as a luxury uh product maker, and something like Versace and they definitely would describe themselves as luxury.
Yeah, well used to be and they used to This is I think the point they used to be they thought of as a luxury brand. I'll give you another example with Coach, although they make seventy percent of tapestries revenue. You have Stuart Whitzman and Kate Spade. When do you think Stuart Whitesman do you think luxury?
I don't know who's Stuart Whitesman.
Oh my god, you're killing me. I'm in a studio full of guys. This isn't fair.
I can't make my point.
But Kate Spade, Come on, okay, Kate's Spade is luxury.
Yet.
Now, if you go to any mall in America, you can find Kate's Bade. If you go to a thirty Rock or Rockefeller Plaza, there's Kate's bad.
Same thing with Sarrovski.
There are these names that used to be very elite very expensive that are now far more accessible, far more household names. And that's because of this kind of move that.
Tapestry and Kate's bade. I know, Caprie Holdings well done.
The thing is what you're right, You're right about that, right, because Kate Spade coach Michael Core's, these are things that are all in the mall, and not just the mall in the middle of Manhattan, one of the most expensive cities in the world. But I'm all in the middle of Columbus, Ohio, which is where I tend to go to mall's exactly. So, but those things they go down market in order to get mass market, right, right.
But that's the value add That's what Michael Core's has done with a lot of these brands. And that's one of his criticisms as well. For the folks who are very high fashion. They're saying, look, you're cheapening the brand
by making it so accessible mainstream. But then if you look at the profit and the turnover, well, the top line growth for some of these companies that they're acquiring is immense because all of a sudden you're accessing people in I don't know, Wyoming, Ohio, Illinois, Texas that you wouldn't have ordinarily, and that's a really big deal.
Is there a consolidation wave going on in the luxury space and if so, why There.
Definitely is, and it's simply because one in the US specifically, I think it's going a bit faster than it is in the likes of Europe, for example. But the wave of consolidation in the US is largely driven by trying to apply the European model to the US and it not really working. So you have seen Tapestry and capre Holdings separately, their stock has been tanking. These are companies that have been struggling relative to some of their international peers.
But you're also that wave of consolidation in Europe.
You're seeing in some of the Middle Eastern brands as well, because the Chinese consumer, which has been driving a lot of the luxury buying, has been slowing do well.
That's why the news coming out of China, which is they're basically going to let the people move about go anywhere they want, So that's going to presumably help Chinese outgoing tourism outside of China, outside of Macau, where they've generally been going to Europe to the US, and I hope to see our Chinese shoppers on Fifth Avenue on Madison Avenue like we used to pre pandemic. Those folks have money and they like to spend on the luxury brands.
And I know the stores that are again on Fifth Avenue, Madison Avenue. They depend on those and.
I hope they're not buying as much or with as much money as they had been in the past, because they drove the price of some of the products that I like way up. For example, Rolex watches on the secondhand market, those prices were far higher. I'm talking two x, three x four x of manufacturing suggested retail price, and they finally, I have been coming back down high end watch prices. And when I saw that story this morning, the first thing I thought is, oh no.
Well.
The first thing I thought was Sam Fizzelli, my wine expert and it also covers pharmaceuticals for Bloomberg Intelligence. He's a big wine guy. He lives in London and lives in France. Big wine guy. He was just explaining to me over the last you know, ten years, how the Chinese have just really rocked the wine market and pushed prices, particularly for fine, French wines way higher, but they've been out of the market.
Yeah, it's funny how we talk about the Chinese consumer almost like we talked about the American consumer. I mean, of course, the US spending power is still significantly higher, but now we actually have to worry about not just Chinese exports but Chinese imports as well, which I think really really speaks to the strength of the country as well.
And to your point on that headline, you saw the European brand specifically, like the Richemont for example, all rally this morning in the European session, so.
A massive move there.
And I also add, I mean we're talking about China in the US, but I really think the Middle East is worth thinking about as well, because if you go to London, you go to what's the high Street London.
I should know this.
I mean, I like the King's Road Kensington.
If you go to like anywhere in Kensington or Chelsea or whatever, there's so many Middle Eastern people from the Middle Eastern shoppers.
And the cars they have, yeah, are pretty cool. So I'm looking at Tapes Street. The stocks down eleven and a half percent, so I guess the market doesn't like I say, paid a big premium here.
Yeah, it's like a sixty five percent premium, and.
Not that the market's not in it for Tap Street, so maybe a dilution concern there for those Oxford streets.
Oxford Street is another one.
There are a number of high streets in London.
And it's funny to hear that question from you because the term high street, I think, is a British term, right, And you're going to be moving to London soon, I am, So you'll be walking up and down Oxford Street.
Youre going to acquire a little bit of an accent, do you think.
No, I'm gonna go over. I'm gonna start saying y'all.
And I was gonna say, she's from Dallas and she doesn't have an accent from there.
So well, that took work, you know, I had to.
I went to UVA and the first thing they asked me was did you drive horses to school and Dallas? And I said no, But why would you think? Then they said, because you say you'll every second word.
That was the end of it.
Sometimes, you know, even in Virginia, go to southern Virginia, it's.
To embrace y'all, To be honest, have you.
It's a very useful word as opposed to.
Oh well, don't ruin it. Oh oh it's a secret.
Oh never mind, where Matt plans all my spares? He throw me a little birthday spare.
When are you going through? That was the end of the end of August of August.
Oh, anyone want to come over and pack because.
It's fun, That's right? Okay, all right, So pritty Gupta with the reporting here today, A little M and a trade in the luxury tapestry buying capri.
You're listening to the tape catch are Live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com.
And the Bloomberg Business app.
You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg eleven thirty.
Let's put this in the context. Lydia Bosor can do that. She's a senior economist at e Why Parthenon and she joins us here, Lydia, what's your take here as you dig into some of the inflation data we got today?
Sure, I mean the report was encouraging. We saw that back to back, the smallest back to back increasing in core inflation. As you mentioned, since early twenty twenty one. We also look at those three months annual life train for both headline and core inflation, and here as well, we saw a significant slowdown. If we dig a little deeper in the component, we are seeing that these inflation in use car prices which declined in July, and we
think that there is more than more pressure coming. And on the housing front, we have also seen a turn in housing inflation and we're starting to see also some gradual disinflation. So overall, I think it's one more step in the right direction when it comes to inflation.
Can you look at, for example, car prices coming down. Can you look at the credit that being given out for those kind of loans to help you forecast what's coming, because I noticed that non revolving credit actually jumped quite a bit last month after stagnating for a few months, and a huge part of that was car loans. You know, My concern, LYDIA is that these numbers bounce back as the economy continues to do so well they do.
I think what we've seen in the auto sector has been quite unique. We still have this imbalance between the supply and the man and that has created some volatility in the sector. So I think, you know, when we look at auction prices, they tend to lead uscalu prices in the CPI, So I think that we're likely to see more downward pressure, but there's likely to be some volatility as well, as you're pointing out.
All right Lydia. Given what we see on inflation coming down, the FED appears to be standing pat maybe one more rate increase. How do you put that on the context with an economic outlook?
Here?
Are you guys thinking that there is a recession in the near term? I mean, I know what recession is going to come at some point, but are you in the campus as it's near term or can we put this on the on the back burner a little bit sure?
In terms of inflation, we're I think we're heading in the right direction. I think the Fed, we look at these numbers, as you know, some convincing progress. I when we look at the economic outlook at the same time, we've seen some economic resilience, but we do expect to see softer economic momentum in the second half of the year. So if you look at economic growth. We are anticipating to see growth, you know, flirting with with essentially zero
heading into twenty twenty four. And at the same time, inflation is also likely to remain in that in that this inflation trend and overall that should make the FED, you know, comfortable enough to stay on the on the sidelines. And we do think that the FED has reached the end of its hiking cycle and that the July ry type was.
The last one, even if we don't see core inflation continued come down. I mean, everyone's kind of taking a victory lap today, but it's still CPI minus food and energy year over year four point seven percent. That's more than twice as much as the FED wants it to be. So don't they need to at least be seen putting some pressure on actively driving it down until it gets to two?
Yes, that's right.
The Fed will be very careful.
I think that if they do pose in September, they will retain a Hockeish bias and they will keep the door open to further tightening if the data justifies it. The FED is really data dependent. We're going to get another CPI report in August. We're likely to see some renewed the poor pressure on headline inflation. We're also seeing oil prices rise again and that's potentially likely to lift
headline inflation as well. But we do think that core inflation will continue to ease a further towards the end of the year. There's a lot of this inflation baked in on the housing front and that's likely to pull down course services inflation, and the FED will be looking at that as some you know, some progress towards getting inflation back to their target LYDIA.
So we've got it. Seems like inflation is you know, trending in the right direction here in the US, but how about Europe. It just seems so much more entrenched there, particularly in the UK. What do you expect the central banks across Europe to do?
Yeah, I think in Europe we're seeing infliction dynamics that are still elevated, but we've also started to see some progress. We're seeing very tight label market conditions in Europe and that's one factor behind you know, the resilience of inflation as as we look as we look ahead, I think we've seen that slow down in the pace of tightening also in Europe and They're likely also to reach the end of their titanic cycle this year. I think when we look at at the FED, it's a little ahead
in the cycle. As I said, we're probably at the end of the of the hiking cycle. And we do see the FED cutting interest rates likely in March, not before March, but likely next year as they start with calibrating policy.
All right, So, uh, the economy.
The economic picture though is different for Europe, right, I mean, here we're looking at still more than two percent GDP growth and over there they're already stagnating.
Do they hit a recession?
There is a high chance I think that that, you know, we could see some recessions in in Europe. We are likely to see i think, across most advanced economies economic growth you know, flirting with full speed growth essentially this this year. And so I think that really when we look at global growth, Europe, US and are likely to be those economies slowing down growth and we're likely to see you know, global growth slowing this year and then gradually rebound into twenty twenty four.
LYDIA thirty seconds. What's your economic what's your labor forecast?
Here?
I mean, is we're going to see unemployment go above four percent anytime soon.
Yes, we do have you know, a further softening in the label market. We think that this gradual rebalancing that we have started to see will continue. So we expect to see a gradual rise in the unemployment rate towards you know, for a little bout four percent by the middle of the next year. And that's going to reflect the fact that labor demand is going to cool further.
We're already we're already seeing that happening and hiring slow down further, as well as we have your software demand and softer economic conditions taking in in the economy.
All right, Lydia, that's really really helpful. We really appreciate checking in with you, Lydia Bosour Senior economists e Hy Partha I is the firm.
You're listening to the team Ken's her live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg dot Com, the iHeartRadio app and the Bloomberg Business App, or listen on demand wherever you get your podcast.
All right, the markets like what they saw from the inflation print today, Let's check with somebody who actually does this stuff for living a deal Zaman. He's a partner for Wall Street Alliance joint us live here in a Bloomberg Interactive broker studio a deal. I like the print today. Matt thinks inflation is still too high. I'm a friend of the trend. I like the trends coming down. That's
what I'm focusing on. How did you view the CPI print today and how does an impact kind of how you're thinking about these markets?
So great to be with you. So we were very positive on this print, and you know the FED vasion of war against the forty year high inflation by raising interest rates to a twenty two year high. And it's clear that the Fed has won this war right. Inflation has come down from around nine percent down to around three point two percent. I think this is construct for the equity markets in the long term.
Is there are you not concerned that there's a chance it comes back.
Well, what we think is that from this point onwards, the inflation will most likely start to cool off on its own, because even if you look at the unemployment rate, we think that it is understated right now because a lot of the layoffs have been in the tech space and a lot of those workers are high earners, so
they're not necessarily claiming unemployment benefits. And also, you know, the FED is going to be very careful about not damaging the unemployment rate too much in this politically charged environment. So we think it's going to start to cool off on its own from this point onwards.
I just saw total consumer credit rose seventeen point eight billion dollars last month. There was a small monthly increase before, so credit had kind of stagnated, but now it's come roaring back, especially student loans and auto loans. And you know, if people are able to weather seven or eight percent auto loans and are still willing to go pay these incredibly high prices for vehicles, I feel like, you know, they could push inflation higher, they could bounce it back.
Up fair point.
But I also feel that, you know that at some point, this excess savings that people have from the pandemic, they're going to run out of it. And when they run out of it, you know, they'll start cutting back on some of the services. Right, So they'll start they'll stop going to Bloomingdale's and they'll start going to Costco. Right, so they'll they'll become more budget conscious. And I think that will also start to bring inflation down, and the data is supporting that.
All right.
So given that backdrop, a deal of a benign inflation outlook, still decent economic growth, although slower than what we've seen. What do you do here? Are you equities? Fixed income? Where do you start?
Well, fixed income is also very attractive overhead, but if we take a longer term point of view, I think equities is where you get the most bang for your buck. We are of the school of thought that we think in the short term you're going to get a correction in the market because seasonally this is a week period of the year. So on the equity side, we would
be looking at opportunities on a pullback. The two parts of the market that we like over here is the high quality momentum areas and then the less love stocks that haven't participated in the rally so far, So we would be looking at opportunistically on those areas on a pullback.
All right. So that means is that the Metas of the world, the Googles of the world, the Amazons, you look, you buy them on a pullback or kind of what's that first group for you?
Yes, So that would be certainly that's one group of stocks. The stocks on our watch list, for example, Apple and Meta. You know, Apple just came out with the earnings. The street did not like it because the iPhone sales went down, but we actually saw strength over there because we saw their service business grow, which is, you know, the profit margins almost double that of the product business. So those are the type of areas that we'd be very interested in on a pullback.
What do you think about I mean rates at this level, you're going to want to lock those in. Don't you think that a lot of people are going to want to lock in four year, four percent, ten years.
Yes, Actually, we have a lot of clients that have cash that are looking to lock in good rates. So certainly I think that's in the short term that is going to be a headwind in the market, But I think that in the long term you get better risk adjusted returns on the equities.
All right.
So, I mean Matt's been overweight, you know those Magnificent seven. Me not so much. So if I'm looking for this market to kind of broaden out a little bit, because I think I need to see that for just the health of the market. If I don't own the magnificent seven. If I don't want to go chase those things, where do I go?
Or should I take profits and get in.
You let it ride, just let it ride.
Well, I agree with you completely like that. If you look at the I SNP five hundred up until the end of last month, it was up about nineteen point six percent. You look at the equal weight index, it was up about nine point six percent. So I would be looking at some of the less love stocks like for example, another stock on our watch list is home Depot. Right, so home Depot did really well during the pandemic because we were trapped in our homes and we just wanted
to improve our living experience. Since then, the demand has subsided, but we still see a great long term potential because in the US we have a housing shortage and people do have to upgrade their homes, which benefits a company like home Depot.
And you own home Depot, you also own Apple. I feel like the market has soured a bit.
Well, clearly they've come down below the three trillion dollar value and we see iPhone sales stagnating.
Why do you own Apple longer term?
So we think that you know the service business, there's a lot of strength over there, so we like that. And then also we think that the iPhone fifteen release could be a significant upgrade. You know, the quality of our phones are improving, so we are holding onto our phones longer before we upgrading it. So I think this upcoming release of iPhone fifteen could be a good catalyst. So and company pays are good dividend.
So I just don't know what's going to change.
The phones that Paul and I have are already capable of everything we need to do.
I got an iPhone eleven. Yeah, that's what I got. I might upgrade, though, I'm going to take you to task on this apple. Every time I see Tim Cook, I say you got to raise your dividend. You've got to dive it in less than one percent, man, up go to three percent, three and a half percent. Are you surprised that they don't do that? With all the cash they have on the bouncey, all the free cash flow they have, I think that they should raise their dividend.
Well yeah, I mean they're they're entering into a different phase of the business, and I think they are doing great with the share buybacks, and I think, you know, I think they have a lot more going on for them in other areas which they want to keep their cash to take advantage of.
How about energy, you know, there's a sector that for a decade nobody cared about because you know, it was peak oil and we're all going green. And then it's had a nice couple three years here, uh, and now we've got WTI oil, you know, back up at almost eighty four dollars a barrel. Do you guys traffic in the energy space at all?
We actually, you know, we actually think oil is headed higher because yeah, because you know the demand for oil as the global economies grow, the demand for oil is going to continue to increase, and OPEK is going to continue to limit production and the transition of it from fossil fuels is going to take a lot of time. So we actually think that the oil inflation is here
to stay and that will keep going higher. And that benefits some of the larger oil players because their break even on oil is very low, and get oil at one hundred dollars a barrel, they are making a killing a deal.
Does China play into your investment thesis?
Certainly, China is a major player, and you know it does have an impact but we find opportunities more domestically in the United States, you know, and especially I.
Just mean in that day.
You know, their economy supports rising prices of oil if it does well.
Yes, so China is definitely a key player there. Global economies. India is a key player, and the US also, you know, the US economy is improving, so that's also increasing the demand for oil. So definitely, we really like some of the larger oil companies that benefit from that.
Thirty seconds, what are you staying away from here?
So?
You know, I think that there's a lot of quality investments right now that you can take advantage of. So I would stay away from the high risk, qualatile meme type of investments and just focus more on quality and look at it in pullbacks. And like you said, fixed income is giving you also an opportunity of a lifetime. You know, one year T bill you're looking at close to five percent. You've never seen that in a long time.
Yeah, it's just amazing. I know people that just roll those things over all the time. A deal Zaman, he's a partner at Wall Street Alliance. We appreciate coming in here.
You're listening to the tape Cancer Live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com, and.
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You can also listen live on Amazon Alexa from our Play New York station just Say Alexa, playing Bloomberg eleven.
Hannah Elliott is going to join us right now. She's there from Los Angeles. She is prepping for getting ready for this great Pebble Beach concourse, concourse to elegance. You've been there a few times, there have never you've got to ever been for you, And it's like everybody I talk to is.
Like, oh, how can you not go to that?
I just haven't really ever had time or been allowed by my boss. But Hannah is like, it's her job, so she joins us now. Also, I think preparing to drive a couple of sweet aston Martin's. Hannah talk to us first about the concourse elegance, and I saw your story about they're building a big barn for some old ferraris, What's what's that all about?
I It's honestly so exciting and cool. I'm really excited. I've got I've gone for many years and this is the most excited. I've been for a while about a bunch of old, rusted out, completely derelic Ferraris that are for cell R. M. Sotheby's. The auction house built a barn displayed to recreate the way that these twenty Ferraris
were found in Florida after a hurricane. They might you might remember two thousand and four we saw some pictures of a bunch of ferraris completely demolished after a hurricane. Now we have the Ferraris foresell. They've reappeared, and they're actually owned by a very eccentric man you might remember named Walter Medlin, who's got quite a colorful history back
to the nineteen seventies or so. But they're gonna these Ferraris are gonna go big, even though they're all twisted and completely rusted out.
Talk to us about the Concourse delegons, What is it and who goes there? Tell us about why it's so, especially in the world of high end automobiles.
Okay, well, Concord Delegons is a really snooty way to say a car show, yep. And what it is is a bunch of really nice, very well washed and detailed cars parked on a putting green and a fair way of golf course.
And anue in Carmel by the Sea exactly.
It's it's actually on the Pebble Beach Car golf course, and there is a set amount of cars that are judged, of course, you know this Q tip white glove type judging.
But then also.
Throughout the week there are auctions, there are other car shows. You know, thousands and thousands of people come. There's kind of something for everybody. There will be car shows just for muscle cars, or just for Porsches, or just for I don't know, old trucks from the seventies. It's really fun. But yes, to your point, the big climax of the week is Sunday's Concord Delegans, the car show on the Pebble Beach golf course.
Yeah, it's just extraordinary. I mean this is big business, Hannah, right. I mean I see stories on some of those cars that get bought and sold during the week, and particularly on Sunday, some huge numbers. Shit, there's real investment here.
Yeah, this is kind of like art collecting in a way. We're talking about blue chip collectibles here. So the most expensive and rare vehicles in the world are bought, showed, shown, and displayed. Certainly the auction houses will see easily over one hundred million dollars in sales just over the weekend, all told through a three or four days of auctions. But you know, you have things that you know there might be two or three of them in the world.
Some of the racing Ferraris, of course, we remember the three hundred sl goal wings, the Mercedes with the doors that raise up a like a goal wing, so really iconic cars. This is the most prestigious car of it, really, certainly in North America. Maybe in the world. You could say there might be a few in Italy that compare, but this really is if you want to see blue chip cars and the best of the best and the rarest this is where you go.
We're showing some of the derelict Ferraris here for those people watching on YouTube or streaming us on Bloomberg dot com. Some of them look like they're in pretty fantastic shape. Others look like they're about to fall apart from all the rust, but they're still expected. Even the one that Hannah, you know, the one that's completely crumpled and doesn't have a roof or maybe even wheels, even that is going to go for hundreds of thousands of dollars.
Yeah, you know, barn finds are very interesting things from what I hear the guys that I talk to. Really, if you're concerned about money, it's better to just buy the car already done. These are not especially at this point. You know, you're you're gonna spend a lot of money to bring them back, maybe even more than you'd spend on a similar car that's already done. So it's really at this point it's about the story. It's about the journey.
The people who buy, you know, these twisted crumple cars are people who love the painful relationship of what it takes to bring a car back to life.
Let me ask about a new car, and that is the dB twelve. You've already driven the car somewhere else besides America, but you're also going to get some seat time in a couple of Aston Martin's coming up. What's the story with this company, where it is and what it's producing.
You know, Aston Martin is really fascinating this year for a number of reasons. We know that they've really struggled since their IPO in twenty eighteen. But they've got a very dynamic owner and Lawrence Stroll, and of course Aston Martin is doing fantastic in Formula One right now, which helps a lot at least from public perception and probably fundraising too. Of course, Lawrence Stroll's son is a race car driver as well, so there's a lot of talk
about Aston Martin. And then when they bring in the dB twelve, which is a successor to the dB eleven, excellent vehicle. They've got the DBX sub seven. I think I'll be in during Monterey fantastic suv. I actually think you could cross shop it against the Lamborghini Urus perhaps, and you could throw in the Ferrari Pro song Wet as well if you wanted. So they're making really competitive products, but also they have really it's been tough. You know,
they faced liquidity issues. There's been a lot of UH there's been a lot of financial UH turnover and executive turnover. Now we also know that they're tied in with Lucid, so there's just a lot going on at Acid Martin. It's a really exciting time and I am looking forward to having some time with their executives to get the latest.
All right, Hannah, great stuff, Enjoy Carmel, Enjoy Pebble Beach. Maybe get a little veal at Ilfrenile on a corner of Ocean Avenue there in Carmel by the Sea, Hannah Ls, staff writer for Bloomberg Business Week. Man, we got to get you there, dude, I someday, uh and get you go for multiple days, and as Hannah was saying, all around the bay, the Monterey Bay area, including Monterey out out near Salinas, all over the Monterey Bay area. Each day there'll be different shows, and you know it's not
just there. So it's just amazing that it culminates on Sunday.
I mean, the next best thing for me is just having Hannah cover it, because then I read all of her coverage and get deep in it. So I feel like if she's out there writing about it, maybe creating some video content as well, that's good enough for me for now.
And then one day when I retire.
Maybe no, please, you can go out there. I'll make it happen. Don't worry. I know a couple of.
People you're listening to the tape Cat's are Live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com, and the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa play Bloomberg eleven thirty.
Matt Miller, Paul Sweeney here live in the Bloomberg Interactive Broker Studio. We are streaming on that YouTube thing. To go over there and just search Bloomberglobal News and now I'll bring it to the video feed. How fun is that?
More global news, bloomerglob You've got to put in the phrase Bloomberg global news. I'm just saying, like I have searched and searched I YouTube and I can't find it. But for some reason, that's a magical phrase, Bloomberg Global News.
I know, I know, I don't know what's crazy. I learned that from Carol Masser, you know, because they've been streaming Bloomberg Business Week for a long time. So she taught me. Well there, so all right, looking at the markets here, up four tens to one percent on the S and P five hundred, let's se where the action is under the hood. Billy Lipscholtz. He covers the markets for Bloomberg News. Joins us here in our Bloomberg Interactive Broker studio. Billy, what are you looking at?
Yeah?
Still seeing quite a bit of weakness for Tapestry after the deal to acquire I'm sorry, Yeah, the deal to acquire Capri and an eight and a half billion dollar deal. Tapestry down thirteen percent, worse performer in the five hundred.
The biggest driver of the upside though, among them is Disney after quarterly results showcasing cost cuts, which will be interesting ahead of News Court results after the belt today, So getting a bit more detail, Paul, As you mentioned in your neck of the woods within the media space. One stock that does stand out though, YETI Holdings.
I don't know if you guys are huge Yetti fan.
I'm a big I'm a big owner of YETI products. Full disclosure here.
I've got the cooler, I've got a couple of the tumblers. Stock up twenty percent right now after better than expected second quarter results, boosting their forecast for earnings for the year. So biggest entry day percentage gained since November. Trading at the highest sense February analysts across Wall Street really praising those results.
It is ridiculous how good those products are. I'll put the I'll put the water in my Yetti little container, go to the beach. I can barely touch the exterior of the bottle because it's so hot from the sun on the beach. Drink the water ice cold.
But why is uh?
Why is Yeti the only name we know because we grew up with coleman or Yeah, Igloo, Iglu, that's the one, exactly, And they don't. I don't know if they make the same kind of products. But there are other cooler makers who make I think what's called Rodo molded coolers right. Arctic Coolers is one, Orca is another. I'm pretty sure Pelican makes them as well. I don't they don't see anything besides YETI. If you go to an Arii, for example, it's all about YETI.
Well, even if you go to Dick's Sporting Goods or Lows and Home Depot, there's an entire YETI section. Wine tumblers, the regular tumblers, mega ones that are like.
My brother's fiance has a Yetti Martini glass. No, she's welcome in.
A family, exactly it's essential to her lifestyle.
It's a lifestyle aspirational brand.
Well it's interesting too. They make backpacks, now, they make clothing.
It seems like they're really branching out into kind of the mainstream consumer goods outside of just coolers, because I remember at one point when the stock was trading down back in twenty twenty one, it peaked above one hundred and seven bucks right now below fifty, and we were kind of calling out, like how many tumblers can a person buy? I mean, my brother's got the backpack, he's got the twelfth pack cooler, But like, other than once you hat kind of Now, does.
Your brother also wear a white baseball cap and talk about his frat all the time and have an.
Old Roa subscription.
No, my brother's actually the he's in that blue collar working class. So he's one of the construction guys who has the cooler loaded.
Up for gotta have that.
Yeah, they have it too, But I just I always feel like I risk if I put a yetti sticker on my truck, or you know, if I wear the hat, I risk being lumped in with that whole you know, good old boy crowd.
I don't know it's weird good.
I don't go to SEC games, you know, I'd love to going to SEC game.
But I feel like Yeti's interesting because it has that kind of you know, fraternity vibe, but also the like construction, firefighter, police officer.
True.
Yeah, yeah, look at that chart. That's another pandemic chart stuck. You know, twenty twenty just started ripping, you know, went from like twenty bucks up to one hundred bucks, and like a lot of those pandemic stocks, at the end of twenty twenty one were peaked kind of been coming down ever since.
Another stock and focus though on Matt. I want your opinion on luxury not luxury. Ralph Lauren right now down two and a half percent, falling for the fifth straight session after they reported quarterly results that had a light two Q forecast. Our Phil's calm luxury brand, Ralph Larett and Luxury are not luxury.
I mean, to my mind, it's a staple.
Course to my mind, it's a sort of staple of the upper middle class, right, And they do make higher end products. The Purple label is one they have RRL, but they don't actually achieve full luxury I think because, for example, RRL likes flight jackets and you know Japanese denim kind of products work where sort of stuff. They don't really have the quality that the truly good and that space have.
They just have the design, all right.
It's a eight billion dollar market cap, up about eighteen percent year to date and down two point seven percent today on the I guess on that print, right, yeah, after those results.
Yeah.
One of the things that I thought was interesting is that they drive half a bit more than half their sales outside of North America.
Really, Okay, so.
That's a bread making up a chunk of that interested to see I'm gonna be really fascinated to see now that China's opening up air travel for its or loosening and I guess a little bit for uh it's uh, you know, people, whether we'll see an outflow of Chinese uh, just visitors and travel. Do they have the same pent up kind of revenue they did?
They allow they're allowing group travel. Yes, so they're allowing like.
Tour groups now to leave China for destinations like the US.
So I guess that's a good first step. But maybe we'll be seeing some more of a Chinese friends here in the big city shopping in some of those big luxury stores. We certainly like to see that.
And gils Bery Hawaiian holding is down four percent.
This all coming after that news Maui's so we're keeping an eye on that. Obviously not a positive update in terms of kind of the news that's coming out of there, but keeping an eye.
On that story is unbelievable. I mean the fires a I've never remember seeing them hearing about fires and why before.
No, I don't know.
If this is a new thing, but boy, and just the destruction of that beautiful area, I guess it's on Maui.
You know, crazy yeah story the former capital YEP of Hawaii has been decimated.
Yeah, it's just terrible news. All right, Belly, thanks so much for joining us. Are Billy lipstialt He covers all the markets for Bloomberg News. I want to talk about endowments. I know a thing or two amount of Doomans having worked on some boards of schools, and for a lot of schools, it's the lifeblood. Its kind of supports the
economics of the school. And some of these big universities report their endowment numbers pretty publicly and Janet lorn Higher education financial report for Bloomberg News joins us here on our Bloomberg Interactive Broker's studio. How did some of these big universities do in this last fiscal year, which I guess ends in June thirtieth.
Yes, we'll be starting to hear more school specific returns coming up in the next month or two. Okay, we get a good snapshot and the median is eight point seven percent, which might sound like a terrific return, but we have to keep in mind inflation. So while you know, you have to factor in spending and also what schools are paying out in terms of inflation, they're also paying higher costs for everything from construction to professor salaries. They're
even paying more in financial aid. So those it may sound like a great return, but a lot of it is being eaten up by inflation.
I have to imagine financial aid spending has gone way up over the past couple of decades because so many I mean I focus on the schools, the big endowments that you write about. You know, so many of those schools have hardly any students who are paying full tuition.
Well, a lot of the schools have been trying to make a concerted effort, you know, to showing Congress and the federal government that they are attracting lower income students. Harvard said this year twenty five percent of their entire freshman class it has an income of eighty five thousand, are below and they're giving more financial aid for students. Who are you trying to have a more diverse and economically diverse class.
You like Columbia University, don't you?
Yes?
I did go to school there.
I mean undergrad of Columbia, Masters and Journalism Columbia. Then a Spencer Fellow for Columbia, which you finished this year.
What is that?
So that is a reporting fellowship looking into education.
Reported everyone comes in, there's so much smarter than we are. I mean, like everyone from Bloombo News comes in and I'm just like you guys kill me, all right? So going back to like your story here, I mean, talk to us about endownm It's how important are they to these schools because it just seems like, you know, I do a lot of work with Duke and they're Endown monstrous and they get great returns and it's such a
big supporter of everything they try to do. But some schools, most schools don't have that right.
Well, and there's a handful of schools that are extremely reliant on the returns. Schools like Princeton and Amherst rely on more than half their entire budgets from endowments. I think in some cases they're sixty percent. But you know, when you look at smaller schools, their endowments are smaller, they're in US equities, and you know, they did much better for their returns this year, given that equities were up about eighteen percent in the period. It just depends
on the school. And as you know, long term returns were about six percent for the ten year average, which is not a great return considering inflation and what they're spending. They actually have to earn a lot more in order to keep pace. So you know, we'll see as these numbers come out how the schools are doing. Last year was a terrible year, the worst year in returns since the Great Recession.
But okay, percent But here alternative investments are, particularly for the larger endowments, are a huge percentage, and it shocks people how much they're putting into hedge funds, private equity, private credit. Thirty forty percent of their endowment. They're putting into these which don't want anymore, probably more some of the bigger ones. They don't have liquidity, that's the downside.
But they make retire.
Okay, there's a scene called market to market. They did not mark the market the down twenty twenty five percent year we had last year. I didn't see it anywhere in the endowments.
Why why would they have to. It's not the same as a bank, No.
But it's an endowment, and I would think they would have marked the market regulations as well.
I don't believe they do.
I don't believe they do it.
I can't imagine.
That's why. And it's interesting because I kept when I listened to the board meeting and I was like, okay, but what about the forty percent we got in you know, some leveraged thing that's in Zimbabwe or something some you know zinc mine. Where's that? You know?
Well, most of the larger schools, you're absolutely right, mostly in alternatives. And that was a big shift starting in the late eighties early nineties when David Swinton, the late CIO at Yale, decided that schools could get a better premium for illiquidity, and most schools really are the big ones shied away from US equities, and in some years
it's really paid off. In this year and in years past, you've seen smaller endowments with larger shares in US equities have much better returns, and of course they're not paying the fees that alternatives command.
Well.
Tuitions across the board continue to rise.
Though, right, Janet, And how long can that happen, especially as we as it becomes a national issue that people owe so much money.
In student dead Well, I think twenty years ago we would have been surprised at the price tag that it
keeps continuing to rise. Now, however, if you look at the share of student loans, the most of the most biggest share is not actually for college, it's for graduate school, because you can really borrow a lot up to the cost of attendance for graduate school, which could be you know, eighty ninety thousand dollars in a year for a federal student loan for your freshman year, you're only you're limited to fifty five hundred dollars, sixty five hundred in the
second year, and seventy five hundred in the third and fourth year, so a bit the biggest share of student debt is really graduate school. Yes, yeah, yeah, there's limits. You know.
Doctor Joel Fleischmann had one hundred and twenty five thousand dollars of debt, did he really?
He paid it off in Alaska, which.
Is why he had to go to Alaska.
Exactly. He went to Columbia Medical School for that show. The show is called Northern Exposure.
Right show. It's now on Netflix. There's a writing campaign. I just bought it, you know.
I've been searching for it for you, I know, and I could never find it.
He's like, I follow him on Twitter because he does a lot of really good stuff, including he's on Billions now. But I followed on Twitter and he said, you say, everywhere I go, people say, how come Northern Exposure is not on.
Netflix's on Netflix? And I just bought it sixty dollars for the whole first season. It's very expensive.
Really, can you send that password to me?
Yes? But there's password sharing, all right, talk to just about I mean, I've got my last of my offspring, my four offspring coming this freshman year in college, a private university. The tuition starts within eight.
Oh my goodness.
Exactly, I'm just like Holy Cow. And there's no end in sight, is there. It's me it's gonna take an Act of Congress because it's just.
A school in Europe because it doesn't make any sense to me.
Well, and when we talk about student loans and you know, you hear this chatter about ten thousand dollars, which of course is not is not happening. It didn't. It never addressed the root cause, which is the increasing cost of college. So you're right, there doesn't seem to be an end in sight, and there's no real regulation. And when schools are when you're looking at default rates for colleges, they're never on the hook. Yeah, they don't have skin in the game.
Yeah, it's just extraordinary. It doesn't feel like I mean, it's the best university system in the world arguably, but boy, it's that the economics are tough for the average person out there. Janet Lauren, thank you so much for joining us. Janet Laurence. She's a higher education financial reporter for Bloomberg News, and I mean, no diversity in her education. It's just Colombia, Columbia, Columbia. I mean, it's a good school and all, but you know,
try something different. It's pretty good. Yeah, it's pretty good.
They have a pretty good journalism school as well.
Man, I know they're very good. They in a great business school too. I've been hiring Peel out of the Columbia Busines School forever and a good history department. Good to know. I'm sure everything's good.
There.
It's Columbia.
You're listening to the tape Cat's are live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, the tune in app, Bloomberg dot Com, and.
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Just search for Bloomberg Radio.
Okay, that's easy. Yeah, all right, you can then you can find that, all right, we can do it anyway. As Charlie was just reporting, Disney reported some numbers there
for the closed stocks up four percent. Lots of cross currents there, reflecting a lot of cross currents in the media industry as this industry tries to shift from a traditional model which was based upon lots and lots of people paying the cable companies and satellite companies a lot of money every month to one now everybody's streaming and what does that do to the economics? Ian Whitaker joins us. He's a managing director and owner at Liberty Sky Advisors.
He's one He's based in London, England. One of the smarter folks I talked to about the global media business. Ian, thanks so much for joining us here. First, what did you make from Disney's results last night and can you extrapolate that out to just kind of how the global media industry is evolving?
Yeah, no, it's very interesting and am I what would say? Well, first of all, in terms of extrapolation, as you say, there's a lot more focused now on cost control and efficiencies. So and this a company divides and interest rates that we saw the market shifted from strategies that were based on growth to ones that assented the emphasize with cost control as well, and that very much was the story
that came across from Disney. When you look at the management remarks very much focusing on what they had done about avertucing capex, what they've done about cost control been more ahead of expectations. There is a flip side to that, though, which is if you are going to focus more on that side, then what it does mean is that you're essentially saying the growth of future growth potential is probably
lower than you expected. And so I think the message that we're getting, particularly in the streaming space, from all of these companies is the markets want them to be more financially disciplined, and that's fine, and are obviously taking steps to do so. But really the underlying message that is coming through is that we think the potential future growth within the market is far less than we anticipated several years ago. And again you can see that in
some of Disney's comments. They were talking about so not all markets will be equal for streaming, their comments on hot Star in India essentially saying we dropped twenty four percent year on year in terms of subscriber numbers, but essentially don't worry because it doesn't have that much impact on the financials. Such a statement probably would never have been made eighteen months ago.
Now.
I think that has some very interesting implications when it comes to valuations, because maybe not so much for Disney, although it's part in there simply because it's it's a constituent part of different entities. But if you take stots like Netflix, for example, probably the valuations where they are at the moment still very much reflect a consensual view that they are still long term growth stories, and probably long term.
High growth stories.
I would question whether that's the case for many of these players.
What do you think about the profitability of streaming services?
Paul was talking to the head.
Of sag Aftra I think last week or two weeks ago, and and she was saying, these streaming services make thirty billion dollars a year in profit.
They want their take. Did they actually make that much money?
No?
I have absolutely no idea where she actually got that number one, because that just does not make sense.
I mean, if you.
Look through the results from these companies, the mainstreaming companies globally, yes, Netflix has an operating profit, but people like Disney is still making losses. Obviously, Peacock several billion dollars losses this year as well, Warner Brothers. Yes, again has brought down the amount of losses, but nobody is near profitability yet. I think this is going to be a very interesting
question sort of. My view is in the next five to ten years this will be a core paper when it comes to NBA studies as to how, quite frankly, these companies traded in what was a model that worked very well for them, i the established PATV model, but essentially one where the economics are just a lot tougher because they were not naturally D two C companies. They've had to go out and do a lot more in terms of marketing. It's a proot of the economics of
their of their of their content businesses as well. I think the argument that this was inevitable I don't necessarily buy that. I think there could have been sort of areas where some of the companies have been smarter, could
have taken different strategies. Sony, for example, I think has adopted the right approach, which is say, look, we don't want to have a D t C business, but what we will be is we will be the arms dealer to everyone else if they want our content, and we will sell it at the highest price and I think that's exactly the right strategy, particularly for let's call them
second tier players within it, within the market. But I think what we will find over the next five years is that what will happened with streaming is that streaming, if there is going to be any profits, they're going to be limited.
But what's going to.
Happen with the major the major media companies is from a financial standpoint, especially in the US, they're going to be outgoinged by the tech companies when it comes to to sports fights. And I think also as well, what I suspect we will then start to see is sort of a reversion back to the idea that streaming doesn't isn't the central focus of everything. I think again, this is what you've seen from warners talking about that the streaming tail should not wag the corporate dog.
Well Ian, I mean, then that kind of goes to the question of are these stocks even investable here in the process while these while this industry is trying to figure out how to generate better profits and better returns, it almost seems like you can't invest in this space in general outside of Netflix.
I mean, what I would say is that I think there is for each of the particularly each of the streaming companies. I think there was a major question about how how they have come about how they have adopted their strategy. She's over the past several years. And what do I mean by that. Well, let's take a Disney Yeah, what it said yesterday, the three core components are theme park, streaming,
and studios. Well, it was only around two and a half years ago that people were pretty much so willing to write off.
The film's business. Yep.
Since she's saying that the way that we watch films is dead, it's all going to be about director streaming and essentially the idea that people will go in a post pandemic world to go and watch movies in the movie theater.
It is just ridiculous.
They made strategic decisions, major strategic decisions based on that, and now what they're having to do is reverse those out as they find out that the decisions they made were wrong. I think streaming again is another example. As I've explained before, I think there are ways that they could have each of them could look to their stress She's and gone about this in a different way. So I think, yeah, with none of these companies, I think companies are at different levels as to where they are
along their strategy realignment. Me for someone like Disney, YEP, I think there was still a question mark as to have they really got that stress.
She fixed all right, We're gonna have to leave it there. Ian appreciate it. Ian Whitaker, Managing director and owner at Liberty Sky Advisors.
Thanks for listening to the Bloomberg Markets podcast. You can subscribe and listen to interviews at Apple Podcasts or whatever podcast platform you prefer. I'm Matt Miller. I'm on Twitter at Matt Miller nineteen seventy three.
And I'm Faul Sweeney. I'm on Twitter at pt Sweeney. Before the podcast, you can always catch us worldwide at Bloomberg Radio